As the much-awaited Union Budget 2024 approaches, India, the esteemed third-largest economy in the world, is expecting revolutionary measures to strengthen its standing internationally. An important Budget announcement is about to be made for the country; these expectations underscore the need for forward-thinking policies that will have a complex impact on India's economic environment.
Industry leaders' general optimism, as India awaits the budget announcement, reflects a variety of expectations, including those for digital infrastructure, manufacturing incentives, regulatory flexibility, and initiatives to support sustainable growth. The budget will be a major factor in determining India's economic future and level of competitiveness worldwide.
Ahead of the budget, the technology industry's expectations made clear how important digital infrastructure, identity, and security are to India's aspiration to become a global center of technology. Leading figures in the industry emphasise the critical need for funding and policy support in these important areas, envisioning a safe and innovation-friendly digital ecosystem. By working together, we hope to unleash India's enormous technological and talent potential and foster an atmosphere that will lead to ground-breaking discoveries.
Ahead of the much anticipated Union Budget 2024, stakeholders from a wide range of industries are looking forward to any policy announcements that may impact the direction of the economy in the upcoming fiscal year. Businesses, industries, and individuals are greatly impacted by the government's budgetary decisions and policy choices. We will examine the expectations from various sectors for the upcoming budget.
Infrastructure and Construction:
Sandeep Goel, Managing Director, Moglix
"Connectivity- physical and digital, has been the focus area of the previous union budgets of the government and is expected to continue in the union budget 2024. I think the next level of digital penetration needs to happen across infrastructure project sites, power plants, and sub-stations and should attract greater outlay on SaaS investments with a vision to reimagine infrastructure-as-a-service and manufacturing-as-a-service. There is a pressing need to inject process discipline through digital project management to taper down cost and time overruns and efficiency leakages. Further, it would be great to see greater fiscal outlay on prescriptive artificial intelligence adoption in areas of essential goods like food, dairy products, rural health care, vaccination programs, and industrial safety to zero down gaps in the amenities that people need for ease of living. The vision of the budget should be to map India’s essential goods, core sector resources, and manpower on the SaaS cloud to create a one nation, one digital supply chain ecosystem for a better quality of life.
Rahul Garg, Founder & CEO, Moglix
India is all set to touch USD 4 trillion in real GDP in 2024. The union budget for 2024 is likely to sustain the infrastructure spending spree. The full budget in July is likely to see a fiscal expansion. I expect a greater approved budget for NHAI to reduce borrowing and therefore road development project costs. Also, I expect a higher outlay on local manufacturing of railway coaches for Amrit Bharat and Vande Bharat trains, and the development of railway stations, airports, and ports. Combined with an interest rate cut by the RBI the budget will be one among a long series of budgets for transforming India’s manufacturing and infrastructure sectors and pushing for India’s green transition. The startup revolution in India has taken off in a big way and a select few matured startups have grown sufficiently to go public. The honorable FM may like to consider simplifying the regulatory framework for IPOs, for startups to leverage the power of India’s equity markets. We are likely to touch a 7% real GDP growth rate comfortably.
"In the last few years, the Government of India has taken significant steps to revamp the healthcare infrastructure, placing a strong emphasis on digital health records under the Ayushman Bharat Digital Health Mission. We anticipate the government's continued commitment to the initiative and look forward to a heightened focus on the robust implementation of this scheme in the upcoming fiscal year, fostering transparency in the healthcare ecosystem and accelerating advancements in treatment outcomes. We also expect a forward-looking approach from the government, emphasizing allocating funds to enhance technology-powered innovative healthcare models tailored for India's diverse population. As a pioneer in the digital healthcare messaging industry, Doceree reaffirms its unwavering commitment to providing steadfast support to the government and its initiative and stands ready to contribute to the ongoing journey to fortify the digitalization of the healthcare economy, leveraging its expertise to drive positive transformation and innovation in the sector." – Dr. Harshit Jain, Founder & Global CEO, Doceree.
Tarun Sharma, Founder & CEO at Yodda- Eldercare.
"While we hope that the upcoming budget boasts inspiring measures for startups and healthcare infrastructure, the previous budget has overlooked a critical need for many senior citizens: Making at-home care accessible and more affordable for elders. Last year's commitment to increasing public health spending and building nursing colleges is commendable, but these alone won't address the immediate challenges faced by millions of aging Indians. The current taxation on at-home elder care acts as a barrier, particularly for low-income seniors. This stands in stark contrast to the tax exemption granted to similar care services. We hope that the upcoming budget addresses these challenges and also consider increasing the basic income tax exemption threshold for senior citizens while exempting at-home elder care from GST altogether or significantly reducing its rate. This would make these crucial services more affordable and accessible to a wider range of seniors. By prioritizing these actions in the coming union budget, the government can truly demonstrate its commitment to a future where all senior citizens, regardless of income, can age with dignity and receive the care they deserve."
Information Technology (IT) and Digital Economy:
Ms Srividya Kannan, Founder and CEO, Avaali Solutions
"As we approach the Union Budget of 2024, the IT and ITES sector greatly anticipates the upcoming announcements. With the world rapidly progressing towards digitalization, this sector has become essential for India's economic prosperity. As a critical contributor to our country's GDP and employment opportunities, this sector expects policies to facilitate growth and innovation further.
We expect the government to allocate more funding towards developing a robust and secure IT ecosystem in the country. The government has already introduced several initiatives to promote the growth of the IT and ITES sector, such as the National Policy on Software Products and the Innovation Fund for Women Entrepreneurs. More funding allocated for this will ensure training and mentorship opportunities; we hope to see more women-led start-ups emerge as key players in the industry. Additionally, there should be an Innovation Fund for AI Innovations that can promote the development of cutting-edge technologies and platforms that can accelerate digital transformation across various sectors, including health, finance, and education. We urge the government to invest in research and development and provide incentives for AI start-ups to thrive and innovate.
To sustain the sector's competitiveness in the global market, we urge the government to provide tax incentives and remove bureaucratic red tape, facilitating ease of doing business. We also expect an increased focus on skill development programs to bridge the gap between the skills businesses seek and what the Indian workforce currently offers.
A critical expectation from the budget is increasing the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) definition to 100 crores and increasing the current limits. The CGTMSE scheme was launched to provide small and micro enterprises with collateral-free loans. By expanding the coverage limit to 100 crore, start-ups and small businesses in the IT and ITES industry will have greater access to funds, enabling them to expand their operations and create more jobs.
The IT and ITES sector is crucial for India's economic growth, and we look forward to policies that prioritize the sector's growth and enable us to develop cutting-edge technological solutions and services that will augment India's position as a global technological powerhouse."
Shreeranganath Kulkarni, Managing Director InfoVision
"As team InfoVision eagerly awaits Budget 2024, we highlight AI's potential to multiply business efficiencies by up to 10X. We call on the government to bolster AI investments, supporting advancements in quantum computing, social digital innovation, and Explainable AI (XAI). Crucial to this effort is the upskilling of our workforce and reforming data governance laws to boost data center investments and enable wider AI/ML adoption. AI's integration into sectors like urban planning, healthcare, and education will be pivotal. A collaborative governance model ensuring ethical data use is key to driving India towards a $5 trillion economy."
Outlook for Startup Sectors:
Greg, CEO and Co-founder, Zoomcar
"Last year’s budget paved a path to higher adoption of EVs in India resulting in a sharp shift of customer mental models to make more greener & smarter choices. With the rise of marketplaces and digitization in India, it is becoming a convenience-first nation setting high benchmarks globally. This year as a publicly listed company, we at Zoomcar anticipate the Union Budget 2024 to pave the way for innovative policies that accelerate sustainable mobility solutions and drive economic resilience which will help customers with cost-effective solutions and mobility apps to support the evolution of transportation in the automobile industry."
On behalf of Shailendra Singh Rao, Founder & MD, Creduce
"This budget would be a vote on account, hence there wouldn't be too much of an expectation from the present government. But because the election results seem to be predetermined towards a certain party we hope that the present budget takes the good work forward.
We hope the Climate Change budget is taken forward with more emphasis on nature-based Solutions. More job creation opportunities are shared in this process. And most importantly technological advancements are encouraged in this sector which would not only help Bharat but also the world."
On behalf of Sarvjeet Virk, Co-founder & MD, Finvasia
"As we approach Budget 2024, we anticipate a continued focus on advancing India's digital public infrastructure, a key pillar for realizing the $5 trillion economy dream. I look forward to enhanced government initiatives fostering financial inclusion benefiting Bharat, not just India. On the tech front, I hope to see further progress in establishing AI Centres of Excellence. There is also a need for more policies to enable public-private partnerships to boost end-use cases of generative and predictive AI and increase its adoption in India. The fintech industry, as usual, will be the flagbearer of innovation. Government support in terms of policies and funding will be instrumental in propelling the fintech sector to new heights of success."
Manufacturing and MSMEs:
Palash Agrawal, the founder/director of Vedas Exports
In the context of the Made in India Campaigns, the current emphasis for domestic players revolves around incentives related to exhibitions. Within the MSME sector, there is a focus on exhibition incentive marketing. It has been observed that the budget for such initiatives should be substantially increased, potentially doubling, to cope with rising expenses. According to existing policies, the allocation for each show ranges from ₹80,000 to ₹1 lakh. Manufacturers hope the budget will see a significant boost to address the escalating costs. Given the three to fourfold increase in exhibition expenditure, our sector is directing attention to budgetary considerations.
Concerning machinery, there is a notable lack of incentives, and this situation should be rectified, mainly through an enhanced tax reduction scheme. On the labor front, the absence of taxation poses challenges for companies with a strong focus on labor incentives, as they miss out on GST benefits.
The sector is also grappling with a significant issue related to input GST, where some companies issue bills but fail to fulfill the GST obligations. Unfortunately, the lack of stringent laws makes it challenging for companies to claim their rightful entitlements in such cases.
"The Agriculture Accelerator Fund in the previous union budget provided significant support to AgTech startups. In anticipation of the upcoming budget, we are hopeful for policies that not only streamline regulatory processes but also encourage cross-border collaborations, fostering a global, collaborative approach. The key to advancing our agricultural sector lies in government initiatives that incentivize cutting-edge technologies, encompassing sustainable and precision farming, AI-driven analytics, and smart irrigation systems. By nurturing innovation, sustainability, and digitalization, the budget has the potential to propel agriculture into a future marked by resilience and efficiency.
The Union Budget has the opportunity to address Food Security, emphasizing an affordable and easily accessible food supply, aligning with the World Health Organization's Zero Hunger initiative. A favourable budget should allocate resources for agricultural technology R&D, focusing on solutions to address evolving agribusiness needs. Incentives for organic farming and a comprehensive approach to ensuring food supply accessibility and affordability are vital for a sustainable global food future. regenerative agriculture practices and climate tech adoption interventions require additional support from the coming union budget. The Union Budget stands as a pivotal moment to sow the seeds of agricultural prosperity, cultivating a future where innovation and sustainability flourish."
Mohan Lakhamraju, Founder and CEO of Great Learning
"With technological advancements happening every minute, relying just on a college education is not enough for the Indian youth. They will have to keep updating and upskilling themselves to utilize their full potential in strengthening our economy. Removal or Reduction of GST rate from upskilling programs in the upcoming Union Budget will help solve this by democratizing access to quality education and fostering innovation and employability. Formalising the edtech sector and streamlining operations through regulations and policies instills confidence among stakeholders, fostering an environment conducive to growth. These changes ultimately align with the national goal of developing a more responsive education system, equipping the workforce in this knowledge-driven economy to meet the evolving demands of the job market."
Perspective for Semiconductor Industry
Dr Venkat Mattela, CEO & Founder, Ceremorphic,
“The new Union Budget 2023 is well designed to unleash innovations in the Artificial Intelligence (AI) space for India. Creating ‘Make AI in India’ and ‘Make AI work for India’ learning infrastructures along with 3 centres of excellence in AI are brilliant initiatives and will go as landmark decisions when we look back in few decades”, said Dr. Venkat Mattela, Founder and CEO of Ceremorphic, Inc which develops AI training supercomputing chips from India.
“Setting up labs for 5G services in engineering institutions is a neat idea as it helps in getting experience in product development earlyz on in educational process. These labs will produce applications which enables efficiency across multiple sectors. Capabilities and expertise in Industry 4.0 is key to the robust economic growth and life style enhancement in the future and the new Pradhan Mantri Kaushal Vikas Yojana 4.0 along with Skill India Digital platform will not only increase the skill set in various areas like AI coding, robotics, mechatronics, IoT, 3D printing but will also encourage more product development in Industry 4.0 going forward. Additionally, setting up of Central Data Processing Centre is a welcome act to create smoother and faster way of getting things done for enterprises.
Continued support for manufacturing is paramount and is well supported by the new targets for increased mobile phone production, reliefs on custom duties on critical parts needed to build peripheral AI interfaces. Low power engineering is the game to play in the next few decades and new architectures will be created where hybrid solutions will be created with lithium batteries along with new architectures that will enable overall energy savings for the total solution. Concessions on duties on the lithium-ion-cells is a key decision to encourage new product development in the industry 4.0. And last but not the least, in tandem with sustainability goals established at G20 summit and a global consensus on reducing carbon emissions, the National Green Hydrogen Mission will facilitate a transition in the economy to low carbon intensity and reduce dependence on fossil fuel imports to drive sustainable growth in the manufacturing space. The Green Credit Programme will serve as a step towards accountability both, at the macro and micro levels”, added Dr. Mattela.
Vivek Tyagi, Managing Director, Analog Devices Inc India
"As we approach the Union Budget 2024, we at Analog Devices Inc. are hopeful for a forward-looking fiscal roadmap that steers the nation towards technological prowess and sustainable growth. We believe the upcoming budget will play a crucial role in shaping India's economic development, particularly in emerging sectors like semiconductors, e-mobility, green hydrogen, and renewable energy. Recent commitments observed at the Vibrant Gujarat Global Summit 2024 underscore the industry's collective dedication to the Indian Government’s vision of a 'Developed India @2047.'
In this dynamic landscape, we encourage policies that bolster the indigenous semiconductor manufacturing ecosystem. The announcements by global players to invest in Gujarat highlight the sector's potential and the need for a conducive policy environment. We believe that the budget should be a catalyst for nurturing innovation, research, and skill development, particularly in frontier technologies like artificial intelligence, 5G/6G networks, and renewable energy.
As the world embraces the integration of 5G technologies, AI-enabled solutions and sustainable practices, we look to the budget to provide a strategic framework that not only navigates current challenges but also sets the stage for India's emergence as a global technology and innovation hub. In essence, the forthcoming budget represents a pivotal opportunity for India to fortify its position on the global stage, and Analog Devices Inc remains committed to contributing to this transformative journey."